T. S. Grewal Solutions for Class 12-commerce Accountancy CBSE Chapter 6: Retirement/Death of a Partner

Retirement/Death of a Partner Exercise 6.77

Solution Ex. 1

As we can see, no information is given as to how A and B are acquiring C's profit share after his retirement, so the new profit sharing ratio between A and B is calculated just by crossing out the C's share.

That is,

∴ New Profit Ratio A and B = 5:4

Solution Ex. 2

Since, no information is given as to how Q and R are acquiring P's profit after his retirement, therefore the new profit sharing ratio between Q and R is calculated simply by crossing out P's share.

∴ New profit Ratio (Q and R ) =4:1

Solution Ex. 3

Old Ratio R, S and M = 2:2:1

M's after retires in the firm. His share taken by R and S = 1:2

Solution Ex. 4

Old Ratio (A,B and C) =4:3:2

New Ratio (B and C)=2:1

Gaining Ratio = New Ratio - old Ratio

Solution Ex. 5

Solution Ex. 6

(a)

New Ratio (W, X and Z)= 1:1:1

New Ratio = New Ratio - Old Ratio

∴ New Ratio= 0:1:1

(b)

Old Ratio (A,B and C)=4:3:2

C's Profit Share =2/9

A get by 4/9 of C's Share and remaining Share is get by B.

New profit share= Old Profit share +share get from C

∴ New Profit Ratio (A and B)=44:37

Gaining Ratio= New Ratio - Old Ratio

∴ Gaining Ratio=or 4:5

Retirement/Death of a Partner Exercise 6.78

Solution Ex. 7

Gaining Ratio = 3:2 (as given in the question)

Solution Ex. 8

Old Ratio (A, B and C)= 8:4:3

Solution Ex. 9

Solution Ex. 10

Calculation of Gaining Ratio

P: Q: R = 7:5:3 (Old Ratio)

Q: R=7:5 (New Ratio)

Gaining Ratio = New Ratio - Old Ratio

Solution Ex. 11

Solution Ex. 12

Old Ratio (A, B and C )=4:3:2

(a)

B gives his share in the original ratio to A and C.

Solution Ex. 13

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
	L's Capital A/c	Dr.		13,000
	O's Capital A/c	Dr.		11,000
	-----------To M's Capital A/c				24,000
	(Being adjustment of M's Share of goodwill made)

Working Notes:

1.

Calculation of Gaining Ratio

M's retires from the firm

Gaining Ratio=New Ratio - Old Ratio

2.

Adjustment of Goodwill

Goodwill of the firm= Rs.72,000

This share of goodwill is to be debited to remaining partners' Capital A/c in their Gaining ratio (L and O) = 13:11

Solution Ex. 14

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.

	R's Capital A/c	Dr.		84,000
	----To P's Capital A/c				42,000
	----To S's Capital A/c				42,000
	(Goodwill adjusted)

Working Notes:

Gaining Ratio = New Ratio - Old Ratio

Solution Ex. 15

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
	Aparna's Capitals A/c	Dr.		18,000
	Sonia's Capital A/c	Dr.		42,000
	----To Manisha's Capital A/c				60,000
	(Manisha's share of goodwill adjusted to Aparna's and Sonia's Capital Account in their gaining ratio )

Working Notes:

WN1: Calculation of Manisha's Share in Goodwill

WN2: Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

Solution Ex. 16

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
	A's Capital A/c	Dr.		15,000
	C's Capital A/c	Dr.		15,000
	-----------To B's Capital A/c				30,000
	(Being adjustment M's Share of goodwill made)

Working Notes:

1.

Calculation of gaining Ratio

B's partner is retirement from the firm.

Gaining Ratio=New Ratio - Old Ratio

2.

Adjustment of Goodwill

Goodwill of the firm=Rs. 90,000

B's share of goodwill is to be debited to remaining partners Capital A/c in their Gaining ratio A and C = 1:1

Retirement/Death of a Partner Exercise 6.79

Solution Ex. 20

Journal Entry
Date	Particulars		L.F.	Debit Rs.	Credit Rs.

	O's Capital A/c	Dr.		20,000
	----- To N's Capital A/c				20,000
	(Being adjustment of N's share of goodwill)

Working Notes:

1.

Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

2.

Calculation of Retiring Partner's share of Goodwill

Thus, only O's Share Capital A/c would be debited with Rs.20,000

Solution Ex. 17

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.

	Hanny's Capital A/c	Dr.		30,000
	Pammy's Capital A/c	Dr.		20,000
	Sunny's Capital A/c			10,000
	-----To Goodwill A/c				60,000
	(Old goodwill written-off in old ratio)

	Hanny's Capital A/c	Dr.		14,000
	Sunny's Capital A/c	Dr.		14,000
	-----To Pammy's Capital A/c				28,000
	(Adjustment for goodwill in gaining ratio)

Working Notes:

WN1: Calculation of Pammy's Share in Goodwill

WN2: Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

Solution Ex. 18

Journal Entry
Date	Particulars		L.F.	Debit Rs.	Credit Rs.

	X's Capital A/c	Dr.		30,000
	Y's Capital A/c	Dr.		20,000
	Z's Capital A/c	Dr.		10,000
	--------To Goodwill A/c				60,000
	(Being goodwill written off)

	Goodwill A/c	Dr.		84,000
	---- To X's Capital A/c				42,000
	---- To Y's Capital A/c				28,000
	---- To Z's Capital A/c				14,000
	(Being before Y's retired distributed of goodwill)

	X's Capital A/c	Dr.		56,000
	Z's Capital A/c	Dr.		28,000
	---- To Goodwill A/c				84,000
	(Being after Y's retired distributed of goodwill)

Working Notes :

1.

Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

Gaining Ratio (X and Z) = 1:1

2.

Calculation of Partner's share of Goodwill (3:2:1)

3.

Calculation of Partner's share of Goodwill after Y retried (2:1)

Solution Ex. 19

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
	A's Capital A/c	Dr.		5,850
	C's Capital A/c	Dr.		4,950
	-----------To B's Capital A/c				10,800
	(Being adjustment B's Share of goodwill made)

Working Notes:

1.

Calculation of B's share of goodwill

B retires from the firm.

Remaining partners A's and C's agreed to pay =Rs.1,50,000

B's Capital after adjustment = Rs.1,39,200

Hidden Goodwill is = Rs.1,50,000 - Rs.1,39,200 =Rs.10,800

2.

Calculation of Gaining Ratio

Gaining Ratio = New Ratio - old Ratio

B's share of goodwill is to be debited to remaining partners Capital A/c in their Gaining ratio A and C = 13:11

Solution Ex. 21

Journal Entry
Date	Particulars		L.F.	Debit Rs.	Credit Rs.

	B's Capital A/c	Dr.		30,000
	D's Capital A/c	Dr.		30,000
	---- To C's Capital A/c				60,000
	(Being adjustment of C's share of goodwill)

Working Notes :

1.

Calculation of Gaining Ratio

C's retires from the firm.

Gaining Ratio = New Ratio - Old Ratio

2.

Calculation of Retiring Partner's Share of goodwill

C's share of goodwill is to be debited to remaining partners Capital A/c in their Gaining ratio B and D = 1:1

Solution Ex. 22

Journal Entry
Date	Particulars		L.F.	Debit Rs.	Credit Rs.

	C's Capital A/c	Dr.		96,000
	----- To A's Capital A/c				72,000
	------ To B's Capital A/c				24,000
	(Being adjustment of A's and B's share of goodwill made)

Working Notes:

1.

Calculation of Gaining Ratio

A's retires from the firm. Gaining Ratio = New Ratio - Old Ratio

2.

Calculation of Retiring Partner's share of Goodwill

A's and B's share of goodwill be brought by C only.

C's Capital A/c debited=72,000 + 24,000 = Rs.96,000.

Solution Ex. 23

Revaluation A/c
Dr.			Cr.
Particulars			Rs.	Particulars	Rs.
To Stock A/c			10,000	By Furniture A/c	12,000
To Machinery A/c			5,000	By Investment A/c	10,000
To Provision for D. Debts A/c			2,000	By Bills Payable A/c	1,000
To Profit transferred to:
	X's Capital A/c	3,000
	Y's Capital A/c	1,800
	Z's Capital A/c	1,200	6,000
			23,000		23,000

Journal
Sr. No.	Particulars		L.F.	Debit Rs.	Credit Rs.
i.	Furniture A/c	Dr.		12,000
	----------To Revaluation A/c				12,000
	(Being increase in value transferred to Revaluation Account)

ii.	Revaluation A/c	Dr.		10,000
	----------To Stock A/c				10,000
	(Being decrease in stock transferred to Revaluation)

iii.	Revaluation A/c	Dr.		5,000
	----------To Machinery A/c				5,000
	(Being decrease in value of machinery transferred to Revaluation Account)

iv.	Revaluation A/c	Dr.		2,000
	----------To Provision for Doubtful debts A/c				2,000
	(Being increase in liabilities to Revaluation Account)

v.	Investment A/c	Dr.		10,000
	----------To Revaluation A/c				10,000
	(Being increase in value transferred to Revaluation Account)

vi.	Bills Payable A/c	Dr.		1,000
	----------To Revaluation A/c				1,000
	(Being decrease in liabilities transferred to Revaluation Account)

vii.	Revaluation A/c	Dr.		6,000
	----------To X's Capital A/c				3,000
	----------To Y's Capital A/c				1,800
	----------To Z's Capital A/c				1,200
	(Being Revaluation Profit transferred to Partners' Capital Account)

Retirement/Death of a Partner Exercise 6.80

Solution Ex. 24

Revaluation Account
Dr.			Cr.
Particulars			Rs.	Particulars	Rs.
To Plant and Machinery A/c (40,000×10%)			4,000	By Building A/c (1,00,000×20%)	20,000
To Provision for Doubtful Debts A/c			1,000	By Stock of finished Goods A/c	5,000
To Stock of Raw Material A/c			2,000	By Computer A/c	2,000
To Workmen's Compensation Claim A/c			5,000
To Profit transferred to:
	A's Capital A/c	6,000
	B's Capital A/c	6,000
	C's Capital A/c	3,000	15,000
			27,000		27,000

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
	Building A/c	Dr.		20,000
	Stock of Finished Good A/c	Dr.		5,000
	Computer A/c	Dr.		2,000
	---------To Revaluation A/c				27,000
	(Being increase in value Assets transferred to Revaluation Account)

	Revaluation A/c	Dr.		12,000
	---------To Plant and Machinery A/c				4,000
	---------To Provision for Doubtful Debts A/c				1,000
	---------To Stock of Raw Material A/c				2,000
	---------To Workmen's Companion Claim A/c				5,000
	(Being increase in value Assets transferred to Revaluation Account)

	Revaluation A/c	Dr.		15,000
	---------To A's Capital A/c				6,000
	---------To B's Capital A/c				6,000
	---------To C's Capital A/c				3,000
	(Being Revaluation Profit transferred to Partners' Capital account)

Solution Ex. 25

Revaluation of assets and liabilities is made at the time of Ramesh's retirement and not after his retirement. Therefore, profits on revaluation will be distributed among all the partners in their old profit sharing ratio or equally in absence of partnership deed.

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
Revaluation A/c	Dr.		12,000
----------To Ramesh's Capital A /c				4,000
----------To Mohan's Capital A/c				4,000
----------To Rahul-s Capital A/c				4,000
(Being Revaluation profit distributed among all the partners in their old ratio)

Solution Ex. 26

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
General Reserve A/c	Dr.		1,80,000
Workmen Compensation Reserve A/c	Dr.		24,000
----------To X's Capital A/c				1,02,000
----------To Y's Capital A/c				68,000
----------To Z's Capital A/c				34,000
(Being Accumulated Profit distributed among partners in old ratio)

X's Capital A/c	Dr.		15,000
Y's Capital A/c	Dr.		10,000
Z's Capital A/c	Dr.		5,000
----------To Profit and Loss A/c				30,000
(Being Debit balance in profit and Loss account distributed among partners in old ratio)

Working Notes:

1.

Total Credit Balance of Reserves

= General Reserve + Workmen Compensation Reserve

=1,80,000+24,000

=2,04,000

Distribution of Reserves

2.

Distribution of Debit Balance of Profit and Loss A/c

Note: Employees' Provident fund being a liability will not be distributed.

Solution Ex. 27

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
Asha's Capital A/c	Dr.		40,000
Naveen's Capital A/c	Dr.		24,000
Shalini's Capital A/c	Dr.		16,000
---------To Goodwill A/c				80,000
(Being Existing goodwill written off amongst existing partners in old ratio)

General Reserve A/c	Dr.		40,000
----------To Asha's Capital A/c				20,000
----------To Naveen's Capital A/c				12,000
----------To Shalini's Capital A/c				8,000
(Being General Reserve distributed among all partners in old ratio)

Shalini's Capital A/c	Dr.		48,000
---------To Asha's Capital A/c				12,000
---------To Naveen's capital A/c				36,000
(Being Goodwill adjusted by debiting gaining partners and crediting sacrificing and retiring partner)

Calculation of Gaining Ratio

Gaining Ratio =New share - Old Share

Retirement/Death of a Partner Exercise 6.81

Solution Ex. 28

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.

	Ram's Capital A/c	Dr.		90,000
	Laxman's Capital A/c	Dr.		60,000
	Bharat's Capital A/c	Dr.		30,000
	--- To Goodwill A/c				1,80,000
	(Being goodwill written off)

	Ram's Capital A/c	Dr.		42,000
	Bharat's Capital A/c	Dr.		42,000
	--- - To Laxman's Capital A/c				84,000
	(Being adjustment of Laxman's share of goodwill)

	Profit and Loss Appropriation A/c	Dr.		1,20,000
	------- To Ram's Capital A/c				80,000
	-- To Bharat's Capital A/c				40,000
	(Being profit on revaluation transferred to 'Partners Capital A/c)

Working Notes :

1.

Calculation of Gaining Ratio

Old Ratio (Ram, Laxman and Bharat) = 3:2:1

New Ratio (Ram and Bharat) = 2:1

Gaining Ratio = New Ratio - Old Ratio

Gaining Ratio (Ram and Bharat) = 1:1

2.

Calculation of Retiring Partner's share of goodwill

Laxman's share of goodwill is to be debited to remaining partners Capital A/c in their Gaining ratio (Ram, Bharat) = 1:1

Solution Ex. 29

C's Capital Account
Dr.	Cr.
Particulars	Rs.	Particulars	Rs.
To C's Loan A/c	7,700	By Balance b/d	6,000
		By C's Current A/c	1,700

	7,700		7,700

C's Current Account
Dr.	Cr.
Particulars	Rs.	Particulars	Rs.
To Balance b/d	500	By Profit and Loss Suspense A/c	550
To C's Capital A/c (Balancing fig.)	1,700	By D's Current A/c	1650

	2,200		2,200

Working Notes:

Solution Ex. 30

Revaluation Account
Dr.	Cr.
Particulars	Rs.	Particulars			Rs.
To Bad Debts A/c	2,000	By Loss Transferred to:
To Patents A/c	9,000		X's Capital A/c	4,400
			Y's Capital A/c	4,400
			Z's Capital A/c	2,200	11,000
	11,000				11,000

Partners Capital Account
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Revaluation A/c (Loss)	4,400	4,400	2,200	By Balance b/d	82,000	60,000	75,500
To Y's Capital A/c (Goodwill)	18,667		9,333	By Reserve A/c (Old Ratio)	7,400	7,400	3,700
To Y's Loan A/c		91,000		By X's Capital A/c (Goodwill)		18,667
To Balance c/d	66,333		67,667	By Z's Capital A/c (Goodwill)		9,333

	89,400	95,400	79,200		89,400	95,400	79,200

Balance Sheet
as on 1^st April 2019 (after Y's Retirement)

Liabilities			Rs.	Assets	Rs.
Creditors			49,000	Cash	8,000
Y's Loan			91,000	Debtors (19,000-2,000)	17,000
Capital				Stock	42,000
	X	66,333		Building	2,07,000
	Z	67,667	1,34,000
			2,74,000		2,74,000

Working Note:

1.

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
X's Capital A/c	Dr.		18,667
Z's Capital A/c	Dr.		9,333
---------To Y's Capital A/c				28,000
(Being adjustment of goodwill made on Y's retirement)

Retirement/Death of a Partner Exercise 6.82

Solution Ex. 31

Revaluation Account
Dr.				Cr.
Particulars			Rs.		Particulars	Rs.
Revaluation Profit					Fixed Assets	60,000
	Kanika's Capital	40,000			Stock	20,000
	Disha's Capital	20,000
	Kabir's Capital	20,000	80,000
			80,000			80,000

Partners' Capital Account
Dr.					Cr.
Particulars	Kanika	Disha	Kabir	Particulars		Kanika	Disha	Kabir
Profit and Loss A/c	10,000	5,000	5,000	Balance b/d		2,00,000	1,00,000	80,000
Kanika's Capital A/c		35,000	35,000	Disha's Capital A/c		35,000
Kanika's Loan A/c	3,00,000			Kabir's Capital A/c		35,000
Balance c/d		80,000	60,000	Revaluation		40,000	20,000	20,000

	3,10,000	1,20,000	1,00,000			3,10,000	1,20,000	1,00,000

Balance Sheet as on March 31, 2016
Liabilities			Rs.	Assets	Rs.
Employees' Provident Fund			47,000	Bank	60,000
Trade Creditors			53,000	Sundry Debtors	60,000
Kanika's Loan A/c			3,00,000	Stock	1,20,000
Capitals				Fixed Assets	3,00,000
	Disha	80,000
	Kabir	60,000	1,40,000
			5,40,000		5,40,000

Working Notes:

WN1: Calculation of Goodwill

Note: Since no information is given about the share of gain, it is assumed that the old partners are gaining in their old profit sharing ratio.

Solution Ex. 32

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
Revaluation A/c	Dr.		4,300
----------To Provision for Doubtful Debts A/c				300
----------To Provision for Outstanding Repairs Bills A/c				4,000
(Being Provision transferred to Revaluation Account)

Prepaid Insurance A/c	Dr.		1,500
Land and Building A/c	Dr.		10,000
----------To Revaluation A/c				11,500
(Being Increase in value of Assets transferred to Revaluation Account)

Revaluation A/c	Dr.		7,200
----------To X's Capital A/c				3,600
----------To Y's Capital A/c				2,400
----------To Z's Capital A/c				1,200
(Being Revaluation Profit distributed among X, Y and Z in their old Ratio)

X's Capital A/c	Dr.		5,400
Z's Capital A/c	Dr.		1,800
----------To Y's Capital A/c				7,200
(Being Y's Share of Goodwill adjusted)

Y's Capital A/c	Dr.		39,600
---------To Y's loan A/c				39,600
(Being Y's Capital balance after all adjustment transferred to his Loan Account)

Balance Sheet
as on 1^st April 2019 (after Y's Retirement)
Liabilities			Rs.	Assets		Rs.
Sundry Creditors			13,800	Cash at Bank		11,000
Provision for Outstanding Repair Bills			4,000	Sundry Debtors	10,000
Y's Loan			39,600	Less: Provision for Doubtful Debts	(500)	9,500
Capital				Stock		16,000
	X	43,200		Prepaid Insurance		1,500
	Z	14,400	57,600	Plant and Machinery		17,000
				Land and Building		60,000
			1,15,000			1,15,000

Working Notes:

1.

Revaluation Account
Dr.			Cr.
Particulars			Rs.	Particulars	Rs.
To Provision for Doubtful debts A/c			300	By Prepaid Insurance A/c	1,500
To Provision for Outstanding Repairs Bills A/c			4,000	By Land And Building A/c (50,000 ×20%)	10,000
To Profit transferred to:
	X's capital A/c	3,600
	X's capital A/c	2,400
	Y's capital A/c	1,200	7,200
			11,500		11,500

Provision for Doubtful debts = New Doubtful debts - Old Doubtful debts

Provision for Doubtful debts = 500 - 300 = 200

2.

Partners Capital Account
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Y's Capital A/c	5,400		1,800	By Balance b/d	45,000	30,000	15,000
To Y's Loan A/c		39,600		By Revaluation A/c	3,600	2,400	1,200
To Balance c/d	43,200		14,400	By X's Capital A/c		5,400
				By Z's Capital A/c		1,800

	48,600	39,600	16,200		48,600	39,600	16,200

3.

Calculation of Ratio

Capital Ratio (X, Y and Z) = 45,000 : 30,000 : 15,000 = 3:2:1

Y's retired in the firm.

X : Z= 3:1 (New Ratio)

Gaining Ratio= New Ratio- Old Ratio

4.

Adjustment of Goodwill

Goodwill on the firm=21,600

Y's share of goodwill is to be distributed between X and Z in their gaining ratio 3:1.

Retirement/Death of a Partner Exercise 6.83

Solution Ex. 33

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
	General Reserve A/c	Dr.		90,000
	------To N's Capital A/c				18,000
	------To S's Capital A/c				27,000
	------To G's Capital A/c				45,000
	(Balance in reserve distributed among all partners in old ratio)

	N's Capital A/c	Dr.		15,000
	S's Capital A/c	Dr.		22,500
	G's Capital A/c	Dr.		37,500
	------To Profit and Loss A/c				75,000
	(Debit balance PandL A/c written off among all partners in old ratio)

	N's Capital A/c	Dr.		18,000
	S's Capital A/c	Dr.		27,000
	------ To G's Capital A/c				45,000
	(Goodwill adjusted in gaining ratio)

	Revaluation A/c	Dr.		1,65,000
	------To Patent A/c				90,000
	------To Stock A/c				7,500
	------To Machinery A/c				22,500
	------To Building A/c				15,000
	------To Creditors A/c				30,000
	(Decrease in assets and increase in liabilities debited to Revaluation A/c)

	Provision for Doubtful Debts A/c	Dr.		2,550
	To Revaluation A/c				2,550
	(Excess provision written back)

	N's Capital A/c	Dr.		32,490
	S's Capital A/c	Dr.		48,735
	G's Capital A/c	Dr.		81,225
	------To Revaluation A/c				1,62,450
	(Loss on revaluation debited to partners' capital accounts in old ratio)

	G's Capital A/c	Dr.		4,21,275
	------To G's Loan A/c				4,21,275
	(Amount due to G transferred to his loan A/c)

Working Notes:

WN1: Calculation of G's Share of Goodwill

WN2: Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

WN2: Calculation of Excess/Deficit Provision for Doubtful Debts

WN3: Calculation of G's Loan Balance

Amount due to G = Opening Capital + Credits - Debits

= 4,50,000 + (45,000 + 45,000) - (37,500 + 81,225)

= Rs.4,21,275

Solution Ex. 34

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
Profit and Loss Adjustment A/c	Dr.		6,000
----------To Plant and machinery A/c				4,000
----------To Provision for Doubtful Debts A/c				1,500
----------To Furniture A/c				500
(Being decrease in value of Assets and provision for doubtful debts transferred to profit and Loss adjustment Account)

Stock A/c	Dr.		3,750
Factory Building A/c	Dr.		5,000
----------To Profit and Loss Adjustment A/c				8,750
(Being increases in value of Assets transferred to Profit and Loss Adjustment Account)

Profit and Loss Adjustment A/c	Dr.		2,750
----------To A's Capital A/c				917
----------To B's Capital A/c				1,375
----------To C's Capital A/c				458
( Being profit distributed among A, B and C in their old ratio)

A's Capital A/c	Dr.		6,400
---------To B's Capital A/c				2,400
---------To C's Capital A/c				4,000
(Being C's Share of goodwill and B's gain in goodwill adjustment)

C's Capital A/c	Dr.		32,125
---------To C's Loan A/c				32,125
(Being loan from bank)

Reserve Fund A/c	Dr.		16,000
---------To A's Capital A/c				5,333
---------To B's Capital A/c				8,000
---------To C's Capital A/c				2,667
(Being Reserve Fund distributed among partners in their old ratio)

Profit and Loss Adjustment Account
Dr.			Cr.
Particulars			Rs.	Particulars	Rs.
To Plant and machinery A/c (40,000×10%)			4,000	By Stock A/c (25,000×15%)	3,750
To Furniture A/c (10,000×5%)			500	By Factory building A/c (50,000×10%)	5,000
To Provision for Doubtful Debts A/c (2,000-500)			1,500
To Profit transferred to:
	A's Capital A/c	917
	B's Capital A/c	1,375
	C's Capital A/c	458	2,750
			8,750		8,750

Partners Capital Account
Dr.							Cr.
Particulars	A	B	C	Particulars	A	B	C
To B's Capital A/c (Goodwill)	2,400			By Balance b/d	30,000	40,000	25,000
To C's Capital A/c (Goodwill)	4,000			By Reserve fund A/c	5,333	8,000	2,667
To C's Loan A/c			32,125	By Revaluation A/c (Profit)	917	1,375	458
To Balance c/d	29,850	51,775		By A's Capital A/c (goodwill)		2,400	4,000

	36,250	51,775	32,125		36,250	51,775	32,125

Balance Sheet
as on 1^st April 2019 (after C's Retirement)

Liabilities			Rs.	Assets			Rs.
Sundry Creditors			25,000	Factory Building			55,000
Loan Payable			15,000	Plant and Machinery			36,000
C's Loan			32,125	Furniture			9,500
Capital				Stock			28,750
	A	29,850		Debtors		18,000
	B	51,775	81,625		Less: Provision for Doubtful Debts	(2,000)	16,000
				Cash in Hand			8,500
			1,53,750				1,53,750

Working Notes:

1.

Calculation of Gaining Ratio

C's retired on the firm.

A : B =3:2 (New Ratio)

Gaining Ratio =New Ratio - Old Ratio

Partners Capital Account
Dr.							Cr.
Particulars	A	B	C	Particulars	A	B	C
To C's Capital A/c (Goodwill)	1,600	2,400		Balance b/d	30,000	40,000	25,000
To B's Loan A/c			32,125	By Reserve Fund	5,333	8,000	2,667
To Balance c/d	34,650	46,975		By Revaluation A/c (Profit)	917	1,375	458
				By A's Capital A/c (Goodwill)			4,000
	36,250	49,375	32,125		36,250	49,375	32,125

3.

Calculation of Gaining Ratio

C retired from the firm.

A : B = 2:3(New Ratio)

Gaining Ratio = New Ratio - Old Ratio

Retirement/Death of a Partner Exercise 6.84

Solution Ex. 35

Revaluation Account
Dr.			Cr.
Particulars			Rs.	Particulars	Rs.
To Machinery A/c (8,000×10%)			8,000	By Expenses Owing A/c (45,000 - 37,500)	7,500
To Loose Tools A/c (4,000× 10%)			4,000	By Factory Premises A/c (2,43,000 -2,25,000)	18,000
To Profit transferred to:
	X's Capital A/c	6,750
	Y's Capital A/c	4,500
	Z's Capital A/c	2,250	13,500
			2,550		2,550

Partners Capital Account
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Y's Capital A/c (Goodwill)	33,750		11,250	By Balance b/d	1,50,000	1,50,000	1,50,000
To Y's Loan A/c		24,450		By Reserve Fund A/c	67,500	45,000	22,500
To balance c/d	1,90,500		1,63,500	By Revaluation A/c	6,750	4,500	2,250
				By X's Capital A/c (Goodwill)		33,750
				By Z's Capital A/c (Goodwill)		11,250

	2,24,250	2,44,500	1,74,750		2,24,250	2,44,500	1,74,750

Balance Sheet
As on 1^st April 2019 (after Y's Retirement)
Liabilities			Rs.	Assets	Rs.
Trade Creditors			30,000	Cash in Hand	15,000
Bills Payable			45,000	Cash at Bank	75,000
Expenses Owing			37,500	Debtors	1,50,000
Y's Loan			2,44,500	Stock	1,20,000
Capital				Factory Premises	2,43,000
	X	1,90,500		Machinery (80,000-8,000)	72,000
	Z	1,63,500	3,54,000	Loose tools (40,000-4,000)	36,000
			7,11,000		7,11,000

Working Notes:

1.

Calculation of Gaining Ratio

X : Y : Z=3:2:1(Old Ratio)

Y's retires from the firm.

∴ Gaining Ratio (X and Z)= 3:1

2.

Adjustment of Goodwill

Solution Ex. 36

Revaluation Account
Dr.			Cr.
Particulars		Rs.		Particulars	Rs.
Stock		900		Premises	16,000
Provision for Legal Damages		1,200		Provision for Doubtful Debts	100
Revaluation Profit				Furniture	4,000
Pankaj's Capital A/c	9,000
Naresh's Capital A/c	6,000
Saurabh's Capital A/c	3,000	18,000
		20,100			20,100

Partners' Capital Accounts
Dr.				Cr.
Particulars	Pankaj	Naresh	Saurabh		Particulars	Pankaj	Naresh	Saurabh
Naresh's Capital A/c	14,000				Balance b/d	46,000	30,000	20,000
Naresh's Loan A/c		26,000			General Reserve	6,000	4,000	2,000
Bank		28,000			Revaluation (Profit)	9,000	6,000	3,000
Balance c/d	47,000		25,000		Pankaj's Capital A/c		14,000
	61,000	54,000	25,000			61,000	54,000	25,000

Bank Account
Dr.		Cr.
Particulars	Rs.	Particulars	Rs.
Balance b/d	7,600	Naresh's Capital A/c	28,000
Bank Loan (Balancing Figure)	20,400

	28,000		28,000

Balance Sheet as on March 31, 2019
Liabilities		Rs.	Assets		Rs.
Sundry Creditors		15,000	Debtors	6,000
Bills Payable		12,000	Less: Provision for Doubtful Debts	300	5,700
Bank Loan		20,400	Stock		8,100
Outstanding Salaries		2,200	Furniture		45,000
Provision for Legal Damages		7,200	Premises		96,000
Naresh's Loan		26,000
Capitals:
Pankaj	47,000
Saurabh	25,000	72,000
		1,54,800			1,54,800

Retirement/Death of a Partner Exercise 6.85

Solution Ex. 37

Revaluation Account
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Profit transferred to:				By Land and building A/c (15,000×10%)	1,500
	X's Capital A/c	1,140		By Provision for Doubtful Debts A/c	105
	Y's Capital A/c	855		By Stock A/c (4,800 × 20%)	960
	Z's Capital A/c	570	2,565
			2,565		2,565

Partners Capital Account
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Y's Capital A/c	1,200		600	By Balance b/d	12,000	9,000	6,000
To X's Capital A/c (Rectification)		420		By Revaluation A/c (profit)	1,140	855	570
To Z's Capital A/c (Rectification)		390		By X's Capital A/c (Goodwill)		1,200
To Y's Loan A/c		10,845		By Z's Capital A/c (Goodwill)		600
To Balance c/d	12,360		6,360	By Z's Capital A/c (Rectification)	420		390
	13,560	11,655	6,960		13,560	11,655	6,960

Balance Sheet
as on 1^st April 2019 (after Y's Retirement)
Liabilities		Rs.	Assets	Rs.
Creditors		24,140	Cash at Bank	3,300
Capital			Sundry Debtors	3,045
Y	12,360		Stock (4,800 +960)	5,760
Z	6,360	18,720	Plant and Machinery	5,100
			Land and Building (15,000 +1,500)	16,500
			Y's Loan*	9,155
		42,860		42,860

*Y's Loan Settle = 20,000 - 10,845=9,155

Working Note:

Adjustment of Goodwill

X :Y : Z= 4 : 3 : 2 (Old Ratio)

Y retires from the firm.

Gaining Ratio = 4 : 2 = 2 : 1

Goodwill of the firm = Rs. 5,400

Y's share of goodwill is to be distributed between X and Z in their = 2:1 (Gaining Ratio)

Retirement/Death of a Partner Exercise 6.86

Solution Ex. 38

Revaluation Account
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Plant and Machinery A/c (28,00010%)			2,800	By Stock A/c (20,00010%)	2,000
To Electronic Typewriter A/c (8,00010%)			800	By Land and Building A/c (36,00010%)	3,600
To Outstanding Salary A/c			2,000	By Provision for Doubtful Debts A/c	2,000
To Profit transferred to:
	A's Capital A/c	800
	B's Capital A/c	600
	C's Capital A/c	600	2,000
			7,600		7,600

Partners Capital Account
Dr.							Cr.
Particulars	A	B	C	Particulars	A	B	C
To B's Capital A/c	2,400		1,800	By Balance b/d	32,000	24,000	20,000
To B's Loan A/c		34,800		By Reserves A/c	8,000	6,000	6,000
To Balance c/d	38,400		24,800	By Revaluation A/c	800	600	600
				By A's Capital A/c		2,400
				By C's Capital A/c		1,800
	40,800	34,800	26,600		40,800	34,800	26,600

Balance Sheet
as on 1^st April 2019 (after B's retirement)
Liabilities		Rs.	Assets	Rs.
Creditors		7,000	Land and Building (36,000+3,600)	39,600
Bills Payable		3,000	Plant and Machinery (28,000-2,800)	25,200
B's Loan		34,800	Electronic Typewriter (8000-800)	7,200
Capital			Stock (20,000+2,000)	22,000
	A	38,400	Sundry Debtors	14,000
	C	24,800	Bank	2000
Outstanding Salary		2,000
		1,10,000		1,10,000

Working Note:

Adjustment of Goodwill

A: B :C= 4 : 3 : 3 (Old Ratio)

As B has retired from the firm, so the Gaining Ratio between A and C is 4 : 3

Goodwill of the firm = Rs.14,000

B's of Goodwill =

B's share of goodwill is to be distributed between A and C in their Gaining Ratio.

Solution Ex. 39

Revaluation Account
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Stock A/c			12,000	By Fixed Assets A/c (3,00,000 10%)	30,000
To Provision for Doubtful Debts A/c (6,000-4,000)			2,000
To Profit transferred to:
	X's Capital A/c	6,000
	Y's Capital A/c	6,000
	Z's Capital A/c	4,000	16,000
			30,000		30,000

Partners Capital Account
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Profit and Loss A/c	1,500	1,500	1,000	By Balance b/d	1,00,000	60,000	50,000
To Advertise Suspense A/c	6,000	6,000	4,000	By General Reserve	30,000	30,000	20,000
To Y's Capital A/c	18,000		12,000	By Revaluation A/c	6,000	6,000	4,000
To Y's Loan A/c		1,18,500		By X's Capital A/c		18,000
To Balance c/d	1,10,500		57,000
				By Z's Capital A/c		12,000
	1,36,000	1,26,000	74,000		1,36,000	1,26,000	74,000

Balance Sheet
as on 1^st April 2019 (after Y's Retirement)
Liabilities		Rs.	Assets			Rs.
Sundry creditors		2,50,000	Cash at Bank			50,000
X's Loan		50,000	Bills Receivable			60,000
Y's Loan		1,58,500	Debtors		80,000
Y's Capital				Less: Provision for D. Debts	(6,000)	74,000
X	1,10,500		Stock (1,24,000-12,000)			1,12,000
Z	57,000	1,67,500	Fixed Assets (3,00,000+30,000)			3,30,000
		6,26,000				6,26,000

Y's Loan Account
Dr.	Cr.
Particulars	Rs.	Particulars	Rs.
To Balance c/d	1,58,500	By Balance b/d	40,000
		By Y's Capital A/c	1,18,500
	1,58,500		1,58,500

Working Note:

1.

Adjustment of Goodwill

Old Ratio (X, Y and Z) = 3 : 3 : 2

Y's retired from the firm.

Gaining Ratio (X and Z) = 3: 2

Y's Share of Goodwill = 80,000 = Rs.30,000

Y's share of goodwill is to be distributed between X and Z in their = 3 : 2 (Gaining Ratio)

X's = 30,000 = Rs.18,000

Z's = 30,000 = Rs.12,000

2.

Distribution of General Reserve (Old Ratio)

X's = 80,000= Rs.30,000

Y's = 80,000= Rs.30,000

Z's = 80,000=Rs.20,000

3.

Writing-off Advisement Suspense (Old Ratio)

X's = 16, 000 = Rs.6,000

Y's =16,000= Rs.6,000

Z's =16,000=Rs.4,000

4.

Writing-off Profit and Loss (Loss) in Old Ratio

X's = 4,000 =Rs.1,500

Y's = 4,000=Rs.1,500

Z's = 4,000=Rs.1,000

Retirement/Death of a Partner Exercise 6.87

Solution Ex. 40

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
2016
1^st April	X's Capital A/c	Dr.		3,000
	Y's Capital A/c	Dr.		2,000
	Z's Capital A/c	Dr.		1,000
	------To Goodwill A/c				6,000
	(Being existing Goodwill Written off)

1^st April	X's Capital A/c	Dr.		3,480
	Y's Capital A/c	Dr.		2,320
	------To Z's Capital A/c				5,800
	(Being Z's share of goodwill credited to him and gaining partners debited in gaining ratio)

Revaluation Account
Dr.					Cr.
Particulars	Rs.	Particulars			Rs.
To Patents A/c	2,000	By Investments A/c(17,600-15,000)			2,600
To Machinery A/c	5,000	By Creditors A/c			4,000
To Provision For D. Debts A/c	400	By Loss on Revaluation transferred:
			X's Capital A/c	400
			Y's Capital A/c	267
			Z's Capital A/c	133	800
	7,400				7,400

Partners' Capital Account
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Goodwill A/c	3,000	2,000	1,000	By Balance b/d	68,000	32,000	21,000
To Revaluation A/c	400	267	133	By X's Capital A/c			3,480
To Z's Capital A/c	3,480	2,320		By Y's Capital A/c			2,320
To Advertisement expenditure A/c	2,625	1,750	875	By Workmen Compensation Reserve A/c	5,625	3,750	1,875
To Investment A/c			17,600	By Investment Fluctuation Reserve A/c	3,000	2,000	1,000
To Bank A/c			5,067
To Z's Loan A/c			2,500
To Bills payable A/c			2,500
Balance c/d	67,120	31,413
	76,625	37,750	29,675		76,625	37,750	29,675

Balance Sheet
as on 1^st April 2019 after Z's retirement
Liabilities		Rs.	Assets			Rs.
Creditors		17,000	Cash at Bank (5,750 - 5,067)			683
Workmen Compensation Claim		750	Stock			30,000
Bills payable		2,500	Patents			8,000
Capital			Debtors		40,000
X	67,120			Less: prov. for Doubtful Debts	(2,400)	37,600
Y	31,413	98,533	Machinery			45,000
Z's Loan		2,500
		1,21,283				1,21,283

Working Note:

Amount due to Z's

= (21,000 + 3,480 + 2,320 + 1,875 + 1,000) -(1,000 + 133+ 875 + 17,600)

= 10,067

Amount paid on Retirement immediately : Rs.5,067

Amount paid within 1 year : (5000 × 50%) = Rs.2,500

Amount payable by Bills of Exchange (50% of Balance) = Rs.2,500

Solution Ex. 41

Dr. Y's Loan Account Cr.

Date	Particulars	Rs.	Date	Particulars	Rs.
31.03.2017 31.03.2017	To Bank A/c To Balance c/d	1,30,000 2,00,000	01.04.2016 31.03.2017	By Y's Capital A/c By Interest A/c	3,00,000 30,000
		3,30,000			3,30,000
31.03.2018 3103.2018	To Bank A/c To Balance c/d	1,20,000 1,00,000	01.04.2017 31.03.2018	By Balance c/d By Interest A/c	2,00,000 20,000
		2,20,000			2,20,000
31.03.2019	To Bank A/c	1,10,000	01.04.2018 31.03.2019	By Balance c/d By Interest A/c	1,00,000 10,000
		1,10,000			1,10,000

Workings:

1. Calculation of Interest:

Solution Ex. 42

Dr. Rakesh's Loan Account Cr.

Date	Particulars	Rs.	Date	Particulars	Rs.
Year 1	To Bank A/c To Balance c/d	26,000 40,000	Year 1	By Rakesh's Capital A/c By Interest A/c	60,000 6,000
		66,000			66,000
Year 2	To Bank A/c To Balance c/d	26,000 18,000	Year 2	By Balance c/d By Interest A/c	40,000 4,000
		44,000			44,000
Year 3	To Bank A/c	19,800	Year 3	By Balance c/d By Interest A/c	18,000 1,800
		19,800			19,800

Workings:

1. Calculation of Interest:

Solution Ex. 43

X : Y : Z = 3 :2 :1 (Old Ratio)

Y's retires from the firm.

Total capital of the New Firm = Rs.2,10,000

Y's share of goodwill is to be distributed between X and Z in their = 3 : 1 (Gaining Ratio)

Computation of Actual Cash to be brought in or to be paid to the partners

Particulars	X	Z
New Capital	1,57,500	52,500
Less: Existing Capital	(1,45,000)	(63,000)
Cash Paid /Brought in	12,500 (Brought In)	(10,500) (Paid Out)

Retirement/Death of a Partner Exercise 6.88

Solution Ex. 44

Revaluation Account
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Provision for D. Debts A/c (500 200)			300	By Prepaid Insurance A/c	1,000
To Machinery A/c (24,0005%)			1,200	By Freehold Premises A/c (50,00010%)	5,000
To Outstanding Workman's C. A/c			1,500
To Profit transferred to:
	A's Capital A/c	1,500
	B's Capital A/c	1,000
	C's Capital A/c	500	3,000
			6,000		6,000

Partners' Capital Account
Dr.							Cr.
Particulars	A	B	C	Particulars	A	B	C
To B's Capital A/c	4,500		1,500	By Balance b/d	45,000	30,000	15,000
To Bank A/c		5,000		By Revaluation A/c (profit)	1,500	1,000	500
To B's Loan A/c		32,000		By A's Capital A/c (Goodwill)		4,500
To Balance c/d	42,000		14,000	By C's Capital A/c (Goodwill)		1,500
	46,500	37,000	15,500		46,500	37,000	15,500
To Balance c/d	45,000		15,000	By Balance b/d	42,000		14,000
				By Cash A/c	3,000		1,000


	45,000		15,000		45,000		15,000

Balance Sheet
as on 31^st March 2019 (after B's retirement)
Liabilities			Rs.	Assets			Rs.
Creditors			10,800	Cash at Bank			12,000
Bills Payable			5,000	Debtors		10,000
Outstanding Workmen Compensation			1,500		Less : Provision for D. Debts	(500)	9,500
B's Loan			32,000	Stock			9,000
Capital A/c's:				Machinery (24,000-1,200)			22,800
	A	45,000		Freehold Premises (50,000+5,000)			55,000
	C	15,000	60,000	Prepaid Insurance			1,000
			1,09,300				1,09,300

Bank Account
Dr.	Cr.
Particulars	Rs.	Particulars	Rs.
To Balance b/d	13,000	By B's Capital A/c	5,000
To A's Capital A/c	3,000	By Balance c/d	12,000
To C's Capital A/c	1,000
	17,000		17,000

Working Notes:

1.

Calculation of Profit Sharing Ratio

Capital Ratio (A, B and C)=45,000 : 30,000 :15,000

Old ratio (A, B and C)=3 : 2 :1

B retires from the firm.

New/Gaining Ratio (A : C) = 3: 1

2.

Adjustment of Goodwill

Goodwill of the firm = Rs.18,000

B's Share of Goodwill = 18,000 = Rs.6,000

B's share of goodwill is to be distributed between A and C in their = 3 : 1 (Gaining Ratio)

3.

Adjustment of Partners' Capital after B's Retirement

Total Capital of the New Firm (after B's retirement) = Rs.60,000

New Ratio = 3 : 1

A's New Capital = 60,000 Rs.45,000

C's New Capital = 60,000 =Rs.15,000

Solution Ex. 45

Revaluation A/c
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Machinery A/c			4,800	By Investment A/c	5,800
To Patents A/c			1,000	By Provident Fund A/c	600
To Profit transferred to
	Amit's Capital A/c	300
	Balan's Capital A/c	200
	Chander's Capital A/c	100	600

			6,400		6,400

Partners' Capital Account
Dr.				Cr.
Particulars	Amit	Balan	Chander	Particulars	Amit	Balan	Chander
To Investment A/c			15,800	By Balance b/d	40,000	36,500	20,000
To Chander's Capital A/c	2,700	1,800		By Revaluation A/c (Profit)	300	200	100
To Loan A/c			10,300	By General Reserve A/c	4,500	3,000	1,500
To Current A/c		5,900		By Amit's Capital A/c			2,700
				By Balan's Capital A/c			1,800
To Balance c/d	48,000	32,000		By Current A/c	5,900


	50,700	39,700	26,100		50,700	39,700	26,100

Working Notes :

1.

Adjustment of Goodwill

Adjustment of Capital

Adjusted Old Capital of Amit and Balan

Amit's = 44,800 (40,000 + 4,500 + 300) - 2,700 = Rs.42,100

Balan's = 39,700 (36,500 + 3,000 + 200) - 1,800 = Rs.37,900

Total Adjusted Capital = 42,100 + 37,900 = Rs.80,000

New Profit Sharing Ratio = 3:2

Solution Ex. 46

Revaluation A/c
Dr.				Cr.
Particulars	Rs.	Particulars			Rs.
To Claim for Workmen	8,000	By Provision for Debts A/c			2,000
Compensation A/c		By Loss on Revaluation
			J's Capital A/c	3,000
			H's Capital A/c	1,800
			K's Capital A/c	1,200	6,000


	8,000				8,000

Partners' Capital Account
Dr.				Cr.
Particulars	J	H	K	Particulars	J	H	K
To Revaluation A/c	3,000	1,800	1,200	By Balance b/d	1,00,000	80,000	40,000
To H's Capital A/c	10,200		20,400	By IFF A/c	10,000	6,000	4,000
To Cash A/c		14,000		By PandL A/c	40,000	24,000	16,000
To H's Loan A/c		1,24,000		By J's Capital A/c		10,200
To Balance c/d	1,36,800		38,400	By K's Capital A/c		20,400
	1,50,000	1,40,600	60,000		1,50,000	1,40,600	60,000
To Current A/c	31,680			By Balance b/d	1,36,800		38,400
To Balance c/d	1,05,120		70,080	By Current A/c			31,680
	1,36,800		70,080		1,36,800		70,080

Balance Sheet for the year ending on 31^st March 2015
Liabilities		Rs.	Assets		Rs.
Creditors		42,000	Land and Building		1,24,000
Capitals			Motor Vans		40,000
J	1,05,120		Investment		38,000
K	70,080	1,75,200	Machinery		24,000
J's Current A/c		31,680	Stock		30,000
Claim for Workmen C.		8,000	Debtors	80,000
H's Loan		1,24,800	Less : Provision	(4,000)	76,000
			Cash (32,000 - 14,000)		18,000
			K's Current A/c		31,680


		3,81,680			3,81,680

Working Notes:

1.

Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

Gaining Ratio (J and k)= 1:2

2.

Adjustment of Goodwill

3.

Total Adjustment of Capital

Total Adjusted Capital of J and K

J's Capital = 1,00,000 + 10,000 + 40,000 - 3,000 - 10,200 = Rs.1,36,800

K's Capital = 40,000 + 4,000 + 16,000 - 1,200 - 20,400 = Rs.38,400

Total Adjusted Capital = 1,36,800 + 38,400 = Rs.1,75,200

K's New Capital > K's Adjusted Capital (K will pay 31,680 to the firm)

J's New Capital < J's Adjusted Capital (Firm will pay 31,680 to J)

4.

Amount transferred to H's Loan A/c

Amount to be transferred = Balance Amount - Cash paid

= (1,40,600 - 1,800) - 14,000 = Rs.1,24,800

Retirement/Death of a Partner Exercise 6.89

Solution Ex. 47

Revaluation Account
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Plant and Machinery A/c (30,00010%)			3,000	By Freehold Premises A/c (40,00020%)	8,000
To Furniture A/c (12,00010%)			840	By Stock A/c (22,00015%)	3,300
To Provision for Doubtful Debts A/c (1,500-1,000)			500
To Profit transferred to:
	X's Capital A/c	3,480
	Y's Capital A/c	1,160
	Z's Capital A/c	2,320	6,960
			11,300		11.300

Partners' Capital Account
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Z's Capital A/c	5,250	1,750		By Balance b/d	30,000	20,000	28,000
To Z's Loan A/c			41,320	By General Reserve	6,000	2,000	4,000
To Balance c/d	34,230	21,410		By X's Capital A/c (Goodwill)			5,250
				By Y's Capital A/c (Goodwill)			1,750
				By Revaluation A/c (Profit)	3,480	1,160	2,320
	39,480	23,160	41,320		39,480	23,160	41,320
To Y's Current A/c		7,500		By Balance b/d	34,230	21,140
To Balance c/d (WN3)	41,730	13,910		By X's Current A/c	7,500
	41,730	21,410			41,730	21,140

Balance Sheet
Liabilities			Rs.	Assets			Rs.
Bills Payable			12,000	Freehold Premises (40,000+8,000)			48,000
Sundry Creditors			28,000	Machinery (30,000-3,000)			27,000
Z's Loan			41,320	Furniture (12,000-840)			11,160
Capital				Stock (22,000+3,300)			25,300
	X	41,730		Sundry Debtors		20,000
	Y	13,910	55,640		Less: provision for Doubtful Debts	(1,500)	18,500
Y's Current			7,500	Cash			7,000
				X's Current			7,500
			1,44,460				1,44,460

Working Notes:

1.

Calculation of Profit Sharing Ratio

X : Y :Z = 3 : 1 : 2 (Old Ratio)

Z retires from the firm. .

Gaining Ratio/ New Ratio (X and Y)= 3 : 1

2.

Adjustment of Goodwill

Goodwill of the firm = Rs.21,000

Z's Share of Goodwill = 21,000= Rs.7,000

Z's share of goodwill is to be distributed between X and Y in their = 3 : 1 (Gaining Ratio)

3.

Adjustment of Partners' Capital after Z's Retirement

Combined Capital of X and Y after all adjustments = 34,230 + 21,410 = Rs.55,640

New Ratio = 3 : 1

Retirement/Death of a Partner Exercise 6.90

Solution Ex. 48

Total capital of firm before retirement = 1, 35,750, + 49,500 + 1.05, 750 = Rs.2,91,000

Amount to be brought by Y = 1, 16,400* - 49,500** = Rs.66,900

**Existing capital of Y = Rs 49,500.

Amount brought by Z = 1,74,600^ - 1,05,750^^ =Rs. 68,850

^^Existing capital of Z = Rs.1,05,750

Solution Ex. 49

Revaluation A/c
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Stock A/c			7,500	By Fixed Assets A/c	37,500
To Profit transferred to
	X's Capital A/c	15,000
	Y's Capital A/c	9,000
	Z's Capital A/c	6,000	30,000

			37,500		37,500

Partner's Capital Account
Dr.				Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Y's Capital A/c	11,250		22,500	By Balance b/d	1,65,000	84,000	66,000
To Bank A/c		1,33,500		By Revaluation A/c	15,000	9,000	6,000
To Balance c/d	2,20,500		1,47,000	By WCR A/c	11,250	6,750	4,500
				By X's Capital A/c		11,250
				By Z's Capital A/c		22,500
				(Goodwill)
				By Bank A/c (Bal. fig.)	40,500		93,000

	2,31,750	1,33,500	1,69,500		2,31,750	1,33,500	1,69,500

Balance Sheet as on 1^st April 2019 (after Y's retirement)
Liabilities			Rs.	Assets	Rs.

Creditors			39,750	Fixed Assets	2,25,000
Employee's Provident Fund			5,250	Stock	75,000
Capital				Bank	15,000
	X	2,20,500		Debtors	97,500
	Z	1,47,000	3,67,500


			4,12,500		4,12,500

Working Notes:

1.

Calculation of Gaining ratio

Old Ratio (X, Y and Z) = 5:3:2

New Ratio (X and Z)=3:2

Gaining Ratio = New Ratio - Old Ratio

2.

Calculation of Retiring Partner's share of goodwill

2.

Calculation of New Capital of Remaining Partners

Total Capital = Assets - Outside Liabilities

= 2,25,000 + 75,000 + 15,000 + 97,500 - 37,750 - 5,250

= 4,12,500 - 45,000

Total Capital = Rs.3,67,500

Solution Ex. 50

Total Capital of firm before retirement = 1,03,680 + 87,840 + 26,880 = Rs.2,18,400

Availability of Cash = 9,600 - 7,200 = Rs.2,440

Combined new Capital of X and Z = Rs.2,16,000

Existing Capital of X = Rs.1,03,680

So, X has to bring = 1,29,600 - 1,03,680 = Rs.25,920

Existing capital of Z = Rs.26,880

So, Z has to bring = 86,400 - 26,880 = Rs.59,520

Solution Ex.51

Revaluation Account
Dr.				Cr.
Particulars		Rs.	Particulars	Rs.
To Provision for Doubtful Debts A/c		1,000	By Creditors A/c	6,000
To Stock A/c (18,000 × 10%)		1,800
To Furniture A/c (30,000× 5%)		1,500
To Outstanding claim for Damages A/c		1,100
To Profit transferred to:
A's Capital A/c	300
B's Capital A/c	200
C's Capital A/c	100	600
		6,000		6,000

Partners' Capital Account
Dr.							Cr.
Particulars	A	B	C	Particulars	A	B	C
To B's Capital A/c (Goodwill)	5,500		1,833	To Balance b/d	40,000	40,000	30,000
To Goodwill A/c	5,000	3,333	1,667	By Revaluation A/c	300	200	100
To Cash A/c		48,200		By A's Capital A/c (Goodwill)		5,500
By Balance c/d	35,800		28,600	By C's Capital A/c (Goodwill)		1,833
				By General Reserve A/c	6,000	4,000	2,000
	46,300	51,533	32,100		46,300	51,533	32,100
To Cash A/c			2,450	To Balance b/d	35,800		28,600
By Balance c/d	78,450		26,150	By Cash A/c	42,650
	78,450		28,600		78,450		28,600

Cash Account
Dr.	Cr.
Particulars	Rs.	Particulars	Rs.
To Balance b/d	18,000	By B's Capital A/c	48,200
To A's Capital A/c	42,650	By C's Capital A/c	2,450
		By Balance c/d	10,000
	60,650		60,650

Balance Sheet as on 1^st April 2019

Liabilities			Rs.	Assets			Rs.
Creditors			24,000	Cash in Hand			10,000
Bills payable			16,000	Debtors		25,000
Outstanding Claim for Damages			1,100		Less: Provision for Doubtful Debts	(4,000)	21,000
Capital				Stock			16,200
	A	78,450		Furniture			28,500
	C	26,150	1,04,600	Machinery			70,000
			1,45,700				1,45,700

Working Notes:

1.

Calculation of Profit Sharing Ratio

A : B :C= 3 : 2 : 1(Old Ratio)

B retires from the firm.

Gaining Ratio and New Ratio (A and C)= 3 : 1

2.

Adjustment of Goodwill

Goodwill of the firm =Rs.22,000 B's Share of Goodwill

B's share of goodwill is to be distributed between A and C in their = 3 : 1 (Gaining Ratio)

A's

C's

3.

Adjustment of Partner's Capital after B's Retirement

Amount to be brought by A and C

= Cash to be paid to B + Minimum balance of Cash -Existing Balance of Cash

=48,200+10,000-18,000

= Rs.40,200

Combined Capital of A and C after all adjustments = 35,000+28,600= Rs.64,400

∴Total Capital of the Firm

= Amount to be brought by A and C + Combined Capital of A and C

=40,200+64,400

= Rs.1,04,600

Retirement/Death of a Partner Exercise 6.91

Solution Ex. 52

Revaluation Account
Dr.					Cr.
Particulars	Rs.	Particulars			Rs.
To Machinery A/c	1,80,000	By Land and Building A/c			1,20,000
To Bad Debts A/c (35,000 - 20,000)	15,000	By Loss on Revaluation transferred to:
			Kusum	21,429
			Sneh	32,142
			Usha	21,429	75,000
	1,95,000				1,95,000

Partners' Capital Account
Dr.							Cr.
Particulars	Kusum	Sneh	Usha	Particulars	Kusum	Sneh	Usha
To Revaluation A/c	21,429	32,142	21,429	By Balance b/d	4,00,000	6,00,000	4,00,000
To Usha's Capital A/c			80,000	By Workmen Compensation Fund A/c	4,286	6,428	4,286
To Bank A/c	1,00,000			By Usha's Capital A/c	80,000
To Kusum's Loan A/c	3,62,857
To Balance c/d		5,74,286	3,02,857
	4,84,286	6,06,428	4,04,286		4,84,286	6,06,428	4,04,286
To Balance c/d		6,00,000	8,00,000	By Balance b/d		5,74,286	3,02,857
				By Bank A/c		25,714	4,97,143
		6,00,000	8,00,000			6,00,000	8,00,000

Balance Sheet
as at 31^st March 2019
Liabilities			Rs.	Assets	Rs.
Creditors			1,00,000	Land and Building	5,20,000
Employee's Provident Fund			70,000	Machinery (6,00,000 - 1,80,000)	4,20,000
Workmen's Compensation Claim			15,000	Stock	2,00,000
Kusum's Loan			3,62,857	Sundry Debtors (2,20,000 - 35,000)	1,85,000
Capital A/c :				Bank	6,22,857
	Sneh	6,00,000
	Usha	8,00,000	14,00,000
			19,47,857		19,47,857

Working Notes

1.

Calculation of Gaining Ratio

Kusum: Sneh : Usha = 2:3:2 (Old Ratio)

Sneh : Usha = 3:4 (New Ratio)

Gaining Ratio = New Ratio - Old Ratio

2.

Adjustment of Goodwill

Total Goodwill of the Firm = 2,80,000

Gaining partners only by Usha to get the goodwill

3.

Adjustment of Capital

Particular	Snehal	Usha
New Capital Balance	6,00,000	8,00,000
Adjusted Old Capital Balance	(5,74,286)	(3,02,857)
Cash brought in by the Partner	25,714	4,97,143

4.

Cash at Bank A/c
Dr.	Cr.
Particular	Rs.	Particular	Rs.
To Balance b/d	2,00,000	By Kusum's Capital A/c	1,00,000
To Sneh's Capital A/c	25,714	By Balance c/d	6,22,857
To Usha's capital A/c	4,97,143
	7,22,857		7,22,857

Retirement/Death of a Partner Exercise 6.92

Solution Ex. 53

Revaluation Account
Dr.					Cr.
Particulars	Rs.	Particulars			Rs.
To Fixed Assets A/c (60,000 - 57,500)	2,500	By Creditors A/c (10,000 - 8,000)			2,000
To Provision for Doubtful Debts A/c	5,000	By Loss on Revaluation transferred to:
			X	2,750
			Y	1,650
			Z	1,100	5,500
	7,500				7,500

Partners' Capital Account
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Revaluation A/c (Loss)	2,750	1,650	1,100	By Balance b/d	40,000	62,000	33,000
X's Capital A/c		24,000	16,000	By Profit and Loss A/c	42,500	25,500	17,000
To Balance c/d	1,19,750	61,850	32,900	By Y's Capital A/c	24,000
				By Z's Capital A/c	16,000
	1,22,500	87,500	50,000		1,22,500	87,500	50,000
To Bank A/c	1,19,750			By Balance b/d	1,19,750	61,850	32,900
To Balance c/d		1,18,500	79,000	By Bank A/c		56,650	46,100
	1,19,750	1,18,500	79,000		1,19,750	1,18,500	79,000

Working Notes

1.

Calculation of Gaining Ratio

X :Y :Z = 5:3:2 (Old Ratio)

X : Z = 3:2 (New Ratio)

Gaining Ratio = New Ratio - Old Ratio

Gaining Ratio (Y and Z) = 3 :2

2.

Adjustment of Goodwill

Total Goodwill of the Firm = 80,000

X's share of goodwill is to be distributed between Y and Z in their = 3 : 2 (Gaining Ratio)

3.

Adjustment of Capital

Total Capital of New Firm = X's Capital + Y's Capital +Z's Capital +Closing balance of Bank Account - Available Bank Balance

=1,19,750 +61,850 + 32,900 + 15,000 - 32,000

= Rs.1,97,500

New Profit Sharing Ratio = 3:2 (Gaining Ratio)

Particular	X	Z
New Capital Balance	1,18,500	79,000
Adjusted Old Capital Balance	(61,850)	(32,900)
Cash brought in by the Partner	56,650	46,100

4.

Cash at Bank A/c
Dr.	Cr.
Particulars	Rs.	Particulars	Rs.
To Balance b/d	40,000	By Creditors A/c	8,000
To Y's Capital A/c	56,650	By X's Capital A/c	1,19,750
To Z's capital A/c	46,100	By Balance c/d	15,000
	1,42,750		1,42,750

Solution Ex. 54

Revaluation Account
Dr.				Cr.
Particulars		Rs.	Particulars	Rs.
To Investment A/c		1,00,000	By Building A/c	4,00,000
To Profit transferred to:			By Stock A/c	2,00,000
A's Capital A/c	2,50,000
B's Capital A/c	1,50,000
C's Capital A/c	1,00,000	5,00,000
		6,00,000		6,00,000

Partners' Capital Account
Dr.							Cr.
Particulars	A	B	C	Particulars	A	B	C
To C's Capital A/c	1,50,000	90,000		By Balance b/d	11,00,000	11,40,000	7,60,000
To C's Loan A/c			13,35,000	By Revaluation A/c	2,50,000	1,50,000	1,00,000
To Balance c/d	17,00,000	15,00,000		By A's Capital A/c			1,50,000
				By B's Capital A/c			90,000
				By Workmen Compensation Reserve A/c	5,00,000	3,00,000	2,00,000
				By P andL Suspense A/c			35,000



	18,50,000	15,90,000	13,35,000		18,50,000	15,90,000	13,35,000

Balance Sheet
as at 30^th June 2018 (after C's retirement)
Liabilities			Rs.	Assets	Rs.
Creditors			2,00,000	Building	22,00,000
Employee's Provident Fund			2,00,000	Investments	3,00,000
C's Loan			13,35,000	Stock	8,00,000
Capital				Debtors	10,00,000
	A	17,00,000		Cash and Bank	6,00,000
	B	15,00,000	32,00,000	Profit and Loss Suspense	35,000
			49,35,000		49,35,000

Working Notes :

1. Calculation of Goodwill

No. of purchase year = 2

Average Profit = Rs.6,00,000

Goodwill = Average Profit × No. years

= 6,00,000 × 2 = Rs.12,00,000

C's share of goodwill is to be distributed between A and B in their = 5 : 3 (Gaining Ratio)

2. Calculation of C's share of Profit

a.

b.

c.

Retirement/Death of a Partner Exercise 6.93

Solution Ex. 55

The Journal entry for transferring Verma's share of profit to his capital account is given below:

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
Profit and Loss Suspense A/c	Dr.		2,350
---------To Verma's Capital A/c				2,350
(Being verma's share of Profit dispensed through his Capital Account)

Solution Ex. 56

Profit (2017 - 18) = Rs.1,00,000

Sales (2017 - 18) = Rs.10,0,000

Solution Ex. 57

Profit before adjusting bad debts (2017 - 18) = Rs.14,000

Bad debts = Rs.2,000

Profits after adjusting bad debts= Rs.(14,000 - 2,000) = Rs.12,000

Proportionate profits (31^st , March 2018)=

B's share of profit (from 1^st April 2018 till 30^th June2018)

Solution Ex. 58

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
Profit and Loss Suspense A/c	Dr.		444
---------To Joshi's Capital A/c				444
(Being Joshi's Profit share credited to his capital account)

Solution Ex. 59

Journal
S. No.		Particulars		L.F.	Debit Rs.	Credit Rs.

	X's Capital A/c		Dr.		36,000
	Z's Capital A/c		Dr.		84,000
		To Y's Capital A/c				1,20,000
	(Proportionate profit dispensed to deceased partner)

Working Notes:

WN1: Calculation of Y's Share of Profit

WN2: Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

Solution Ex. 60

Journal
S. No.		Particulars		L.F.	Debit Rs.	Credit Rs.

(a)	Profit and Loss Suspense A/c		Dr.		1,000
	-----To Z's Capital A/c					1,000
	(Proportionate profit dispensed to deceased partner)

(b)	X's Capital A/c		Dr.		800
	Y's Capital A/c		Dr.		200
		To Z's Capital A/c				1,000
	(Proportionate profit dispensed to deceased partner)

Working Notes:

WN1: Calculation of Z's Share of Profit

WN2: Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

Solution Ex. 61

a. Calculation of R's Share of Goodwill

b.

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
P's Capital A/c	Dr.		48,000
S's Capital A/c	Dr.		12,000
-------To R's Capital A/c				60,000
(Being R's share of goodwill adjusted)

Working Notes:

R's Share of Goodwill = Rs.60,000

P : R : S = 4: 3 : 1 (Old Ratio)

R's death.

Gaining Ratio (P and S)= 4 :1

R's share of goodwill is to be distributed between P and S in their = 4 : 1 (Gaining Ratio)

Retirement/Death of a Partner Exercise 6.94

Solution Ex. 62

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
2018
30 June	X's Capital A/c	Dr.		15,000
	Z's Capital A/c	Dr.		5,000
	------To Y's Capital A/c				20,000
	(Being Y's share of goodwill adjusted through X and Y's Capital Account in gaining ratio, i.e., 3:1)

30 June	Profit and Loss suspense A/c	Dr.		12,500
	------To Y's Capital A/c				12,500
	(Being Y's profit share till his death debited to PandL suspense A/c)

Working Notes:

1.

Calculation of Y's Share of Goodwill

Goodwill = Rs.60,000

Y's share of goodwill is to be distributed between X and Z in their = 3 : 1 (Gaining Ratio)

2.

Calculation of Y's Share of Profit

Past Year Profit = Rs.1,50,000

Y's share of Profit (till death) = Previous Years Profit ×Y's Profit Share ×3 months (1^st April 2018 till 30^th June2018)

Solution Ex. 63

Journal
Date	Particulars		L.F.	Debit Rs.	Credit Rs.
2018
30 June	A's Capital A/c	Dr.		1,50,000
	C's Capital A/c	Dr.		50,000
	------To B's Capital A/c				2,00,000
	(Being B's share of goodwill adjusted through A and B's Capital Account in gaining ratio, i.e., 3:1)

30 June	B's Capital A/c	Dr.		1,25,000
	------To Profit and Loss suspense A/c				1,25,000
	(Being B's share in loss till his death credited to PandL suspense A/c)

Working Notes:

1.

Calculation of B's Share of Goodwill:

Goodwill = Rs.6,00,000

B's share of goodwill is to be distributed between A and B in their = 3 : 1 (Gaining Ratio)

2.

Calculation of B's Share of Profit:

Past Year Loss = Rs.15,00,000

B's share of Profit (till death) = Previous Years Profit ×B's Profit Share ×3 months (1^st April 2018 till 30^th June2018)

Solution Ex. 64

Journal
Date	Particular		L.F.	Debit Rs.	Credit Rs.
	Z's Capital A/c	Dr.		75,000
	--------To Y's Capital A/c				75,000
	(Being adjustment of Y's share of Goodwill)

	Z's Capital A/c	Dr.		23,438
	--------To Y's Capital A/c				23,438
	(Being adjustment Y's share of profit)

Working Notes:

1.

Calculation of Gaining Ratio

Old Ratio (X, Y and Z) = 4 : 3 : 1New Ratio = (X and Z) = 1 : 1

Gaining Ratio = New Ratio - Old Ratio

Gaining Ratio only Z's =

2.

Calculation of Retiring Partner's Share of Goodwill

Y's share of goodwill is to be brought by Z only

3.

Calculation of Retiring partner's Share of Profit

Average profit for past 2 years = Rs. 75,000

Solution Ex. 65

Y's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Y's Executor's A/c	12,800	By Balance b/d	6,000
		By X's Capital A/c (Reserve)	1,200
		By X's Capital A/c (Goodwill)	5,040
		By X's Capital A/c (Profit)	560
	12,800		12,800

Working Notes:

1.

2.

Calculation Y's Share of Reserve

3.

Calculation Ys Share of Profit

4.

Calculation of Ys Share of Goodwill

Y's share of Goodwill = Y's Profit Share in previous 3 years

Profit for previous 3 years = 4,200 + 3,900 + 4,500 = Rs.12,600

Retirement/Death of a Partner Exercise 6.95

Solution Ex. 66

P's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Drawings A/c	15,000	By Balance b/d	80,000
To Interest on Drawings A/c	1,200	By Interest on Capital A/c	1,600
To P's Executor's A/c	69,400	By Salary A/c (12,000× 2/12)	2,000
		By Profit and Loss Suspense A/c	2,000
	85,600		85,600

Working Notes:

1.

Calculation of Interest on Capital

P's Capital = Rs.80,000

2.

Calculation of P's Share of Profit

Profit for previous year = Rs.30,000

Solution Ex. 67

Momita's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Drawings A/c	10,000	By Balance b/d	60,000
To Interest on Drawings A/c	300	By Interest on Capital A/c	1,800
To Executor's A/c	83,000	By Profit and Loss Suspense A/c	4,500
		By Vikas"s Capital A/c	13,500
		By Gagan's Capital A/c	13,500
	93,300		93,300

Working Notes:

1.

Calculation of Interest on Momita's Capital

2.

Calculation of Momita's share in Profits

3.

Adjustment of Goodwill

Average Profit = 45,000

Goodwill = Average Profit × Number of years' purchase

Goodwill = 45,000 × 3 = Rs.1,35,000

Note: Since, here no information is given regarding the share acquired by Vikas and Gagan. Thus, the goodwill distributed between new profit sharing ratio = 2:2 or 1:1

Solution Ex. 68

Qureshi's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Qureshi's Loan A/c	1,00,000	By Balance b/d	1,00,000
To Interest on Loan A/c	4,000	By Pooja's Capital A/c	13,500
To Executor's A/c (Balancing figure)	68,875	By Ross's Capital A/c By General Reserves	6,750 50,000
		By Profit and Loss Suspense A/c	2,625

	1,72,875		1,72,875

Working Notes:

1.

Calculation of Interest on Qureshi's Loan

2.

Calculation of Qureshi's share in Profits

3.

Adjustment of Goodwill

Goodwill = Total Profits of last 2 years

Goodwill = 48,000 + 33,000 = Rs.81,000

Note: Since, here no information is given regarding the share acquired by Pooja and Ross,

Qureshi's share of goodwill will be distributed between new profit sharing ratio = 2:1.

Retirement/Death of a Partner Exercise 6.96

Solution Ex. 69

Kapoor's Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Drawings A/c	5,000	By Balance b/d	40,000
To Interest on Drawings A/c	100	By Interest on Capital A/c	300
To Balance c/d	38,200	By Profit and Loss Adjustment A/c	3,000
	43,300		43,300

Working Notes

1.

Calculation of Interest on Capita

2.

Calculation of Share of Profit

3.

Calculation of Interest on Drawings

Interest on Drawings = Drawings × 2%

=5,000 ×2%

=100

Solution Ex. 70

A's Capital Account
Dr.		Cr.
Particulars	Rs.	Particulars	Rs.
To A's Executors A/c	57,000	By Balance b/d	25,000
		By A's Loan A/c*	5,000
		By Interest on A's Loan A/c*	150
		By Reserve A/c	3,000
		By B's Capital A/c (Goodwill)	11,250
		By C's Capital A/c (Goodwill)	7,500
		By Profit and Loss Suspense A/c	3,750
		By Interest on Capital A/c	1,250

	56,900		56,900

A's Executors Account
Dr.		Cr.
Particulars	Rs.	Particulars	Rs.
To Bank A/c	28,450	By A's Capital A/c	56,900
To A's Executors Loan A/c	28,450

	56,900		56,900

Working Notes:

1.

Calculation of Reserve

2.

Calculation of Interest on Capital

Calculation of Profit and Loss Suspense

4.

Calculation of Share in Revaluation Profit/Loss

Revaluation = -3,000 - 2,000 + 5,000 = Nil

4

Calculation of Share in Goodwill

Goodwill = Average Profit × No. of years Purchase

= 15,000 × 2.5 = Rs. 37, 500

A's share of goodwill is debited to be distributed between B and C in their = 3 : 2

*A's Loan Account and Interest on A's Loan can be directly transferred to A's Capital or Executor's Account. Interest on A's Loan is @6% as per Indian Partnership Act, 1932.

Solution Ex. 71

Virad's Capital Account
Dr.		Cr.
Particulars	Rs.	Particulars	Rs.
To Executor's A/c	5,70,000	By Balance b/d	3,00,000
		By Vishad's Capital A/c	1,12,500
		By Roma's Capital A/c	75,000
		By Profit and Loss Suspense A/c	37,500
		By Reserve fund A/c	30,000
		By Interest on Capital A/c	15,000
	5,70,000		5,70,000

Calculation of Gaining Ratio of Vishad and Roma:

Old Ratio (Virad , Vishad and Roma)= 5: 3 : 2

New Ratio (Vishad and Roma) = 3 : 2

Gaining Ratio = New Ratio - Old Ratio

Gaining Ratio (Vishad and Roma)= 3 : 2

Working Notes:

1.

Calculation of Virad's Share of Goodwill:

Goodwill = Average profit × Number of Years Purchase

2.

Calculation of Profit share of Virad:

Profit for the year = Rs. 1,50,000

3.

Calculation of Interest on Virad's Capital:

Virad's Capital = 3,00,000

4.

Virad's share Reserve fund:

Retirement/Death of a Partner Exercise 6.97

Solution Ex. 72

Kavita's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Kavita's Executor's A/c	1,32,100	By Capital A/c	70,000
		By Interest on Capital A/c	2,100
		By Leena's Capital A/c (Goodwill)	10,000
		By Monica's Capital A/c (Goodwill)	30,000
		By Share of Reserve A/c	12,000
		By P and L Suspense A/c (Profit)	8,000
	1,32,100		1,32,100

Working Note:

1.

Calculation of Goodwill

On the basis of 2 yrs purchase of average 3 years profit

Goodwill = Average Profit × 2

= Rs.1,00,000 ×2 =Rs.2,00,000

Kavita's share of goodwill is to be distributed between Leena and Monica in their = 1 : 3 (Gaining Ratio)

2.

Calculation of Profit and Loss Suspense

Profit for year 2011-12 =2,00,000 = 10% of Sales.

Thus, Profit for the Period 1^st April to 30^th September =10% of Sales

Share of profit for to be divided = 4,00,000 × 10%=Rs.40,000

Kavita's profit =

Solution Ex. 73

B's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To B's Executor's A/c	3,47,000	To Balance b/d	1,20,000
		To Interest on Capital A/c	3,000
		To General Reserve A/c	40,000
		To Profit and Loss Suspense A/c	40,000
		To Goodwill A/c	1,44,000
	3,47,000		3,47,000

B's Executor Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Bank A/c	3,47,000	By B's Capital A/c	3,47,000

	3,47,000		3,47,000

Working Notes:

1.

Calculation of Interest on Capital

Opening Capital =Rs.1,20,000

2.

Calculation of Profit Share up-to-death

3.

Calculation of goodwill

Solution Ex. 74

Chetan's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Chetan's Executor's A/c	1,79,750	By Capital A/c	1,25,000
		By Interest on Capital A/c(for 6 months)	3,750
		By Babita's Share Capital A/c (Goodwill)	16,000
		By David's Share Capital A/c (Goodwill)	8,000
		By Share of Reserve A/c	12,000
		By P and L Suspense A/c (Profit)	15,000
	1,79,750		1,79,750

Working Note:

1.

Chetan's Goodwill = Rs.24,000

Chetan's share of goodwill is to be distributed between Babita and David in their = 2 : 1 (Gaining Ratio)

2.

Calculation of Profit and Loss Suspense

Sales in the year (2011-12) = 4,00,000

Profit for year (2011-12) =4,00,000 × 50% (of Sales) = 2,00,000

Thus, Profit for the Period (1^st April to 30^th September) = 50% of Sales

Profit to be divided = 1,20,000 × 50% = Rs.60,000

Chetan's Profit

Retirement/Death of a Partner Exercise 6.98

Solution Ex. 75

Honey's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Executors A/c	81,350	By Balance b/d	30,000
		By Interest on Capital A/c	1,350
		By Profit and Loss Suspense A/c	40,000
		By General Reserve A/c	10,000
	81,350		81,350

Working Notes:

1.

Calculation of Honey's Interest on Capital

2.

Calculation of Honey's in profit

3 Calculation of Honey's Share in General Reserve

Solution Ex. 76

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
Revaluation A/c	Dr.		10,000
------To machinery A/c				10,000
(Being decrease in value of Machinery transferred to Revaluation Account)

Patents A/c	Dr.		10,000
Leasehold A/c	Dr.		25,000
------To Revaluation A/c				35,000
(Being increase in value Patents and Leasehold transferred to Revaluation Account)

Revaluation A/c	Dr.		25,000
------To R's Capital A/c				12,500
------To S's Capital A/c				7,500
------To T's Capital A/c				5,000
(Being revaluation profit distributed among partners in their old ratio)

R's Capital A/c	Dr.		12,500
S's Capital A/c	Dr.		7,500
T's Capital A/c	Dr.		5,000
------To Goodwill A/c				25,000
(Being goodwill written off among partners in their old ratio)

R's Capital A/c	Dr.		21,875
S's Capital A/c	Dr.		13,125
------To T's Capital A/c				35,000
(Being T's share of goodwill adjusted)

Profit and Loss Suspense A/c	Dr.		5,000
------To T's Capital A/c				5,000
(Being T's share of profit transferred to his capital account)

Workmen's Compensation Reserve A/c	Dr.		30,000
------To R's Capital A/c				15,000
------To S's Capital A/c				9,000
------To T's Capital A/c				6,000
(Being Workmen's Compensation Reserve distributed among partners in their old ratio)

T's Capital A/c	Dr.		1,21,000
------To T's Executors A/c				1,21,000
(Being amount due to T after all adjustments transferred to his Executor's Account)

T's Executors A/c	Dr.		21,000
------To Bank A/c				21,000
(Being amount paid T's Executor)

T's Executor's Account
Dr.					Cr.
Date	Particulars	Rs.	Date	Particulars	Rs.
2014			2014
1 Aug	To Cash A/c	21,000	1 Aug	By T's Capital A/c	1,21,000
2015			2015
31 Jan	To Cash A/c (25000+5000)	30,000	31 Jan	By Interest A/c (1,00,000×10% for 6 months)	5,000
31 Mar	To Balance c/d	76,250	31 Mar	By Interest A/c (75,000×10% for 2 months)	1,250
		1,27,250			1,27,250
2015			2015
1 Aug	To Cash A/c (25,000 + 1,250 + 2,500)	28,750	1 Apr	By Balance b/d	76,250
2016			1 Aug	By Interest A/c (75,000×10% for 4 months)	2,500
31 Jan	To Cash A/c (25,000+ 2,500)	27,500	2016
31 Mar	To Balance c/d	25,417	31 Jan	By Interest A/c (75,000×10% for 6 months)	2,500
			31 Mar	By Interest A/c (75,000×10% for 2 months)	417
		81,667			81,667
2016			2017
1 Aug	To Cash A/c (25,000+417+833)	262,50	1 Apr	By Balance b/d	25,417
			1 Aug	By Interest A/c (25,000×10% for 4 months)	833
		26,250			26,250

Working Notes:

1.

Calculation of Goodwill

Goodwill = Average Profit × Number of Year's Purchase

Goodwill = Average Profit ×Number of Years' Purchase

= 70,000 × 2.5 = Rs.1,75,000

2.

Adjustment of Goodwill

R : S : T= 5:3:2 (Old Ratio)

T's death.

Gaining Ratio (R and S)= 5 : 3

T's share of goodwill is to be distributed between R and S in their = 5 : 3 (Gaining Ratio)

3.

Calculation of T's Share of Profit

Profit for year (2011-12) = Rs.75,000

4.

Revaluation Account
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Machinery A/c			10,000	By Patents A/c	10,000
To Profit transferred to:				By Leasehold A/c	25,000
	R's Capital A/c	12,500
	S's Capital A/c	7,500
	T's Capital A/c	5,000	25,000
			35,000		35,000

5.

T's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Goodwill A/c	5,000	Balance b/d	75,000
To T's Executor's A/c	1,21,000	By Workmen's Compensation Reserve A/c	6,000
		By Profit and Loss Suspense A/c	5,000
		By R's Capital A/c	21,875
		By S's Capital A/c	13,125
		By Revaluation A/c (profit)	5,000
	1,26,000		1,26,000

Retirement/Death of a Partner Exercise 6.99

Solution Ex. 77

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
General Reserve A/c	Dr.		45,000
------To Akhil's Capital A/c				15,000
------To Nikhil's Capital A/c				15,000
------To Sunil's Capital A/c				15,000
(Being general Reserve distributed among partners in their old ratio)

Akhil's Capital A/c	Dr.		35,000
Nikhil's Capital A/c	Dr.		35,000
------To Sunil's Capital A/c				70,000
(Being Sunil's share of goodwill adjusted)

Interest on Capital A/c	Dr.		1,600
------To Sunil's Capital A/c				1,600
(Being interest allowed on Sunil's Capital)

Profit and Loss Suspense A/c	Dr.		20,000
------To Sunil's Capital A/c				20,000
(Being Sunil's profit share transferred to his capital account)

Sunil's Capital A/c	Dr.		1,86,600
------To Sunil's Executor's A/c				1,86,600
(Being amount due to Sunil's after all adjustments transferred to his Executor's Account)

Sunil's Executor's A/c	Dr.		50,000
------To Bank A/c				50,000
(Being amount paid to Sunil's Executor)

Sunil's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Sunil's Executor's A/c	186,600	By Balance b/d	80,000
		By Interest on Capital A/c	1,600
		By General Reserve A/c	15,000
		By Profit and Loss Suspense A/c	20,000
		By Akhil's Capital A/c (Goodwill)	35,000
		By Nikhil's Capital A/c (Goodwill)	35,000
	1,86,600		1,86,600

Sunil's Executor's Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Bank A/c	50,000	By Sunil's Capital A/c	1,86,000
By Balance c/d	1,36,600
	1,86,600		1,86,600

Working Notes:

1.

Calculation of Sunil's Share of Profit

Profit for year (2017-18) = Rs.1,80,000

2.

Calculation of Goodwill

Goodwill = Average Profit × No. of Year's Purchase

Goodwill = Average Profit × No. of Years Purchase

= 70,000 × 3 = Rs.2,10,000

3.

Adjustment of Goodwill

Akhil's : Nikhil's : Sunil's = 1 : 1 : 1 (Old Ratio)

Sunil died

Gaining Ratio (Akhil's and Nikhil's) = 1 : 1

Sunil's share of goodwill is to be distributed between Akhil and Nikhil in their = 1 : 1 (Gaining Ratio)

4.

Calculation of Interest on Sunil's Capital

Sunil's Capital = Rs.80,000

Solution Ex. 78

(i) Calculation of Goodwill

Goodwill = Average Profit × Number of Year's Purchase

Goodwill = Average Profit × Number of Years' Purchase

= 30,000×3 =Rs.90,000

B : C : D = 5: 3 : 2 (Old Ratio)

After B's Death.

Gaining Ratio (C and D) = 3 : 2

B's share of goodwill is to be distributed between C and D in their = 3 : 2 (Gaining Ratio)

(ii) Calculation of as Share of Profit or Loss

Loss for the Year (2008) = Rs.70,000

(iii)

B's Capital Account
Dr.			Cr.
Particulars	Rs.	Particulars	Rs.
To Profit and Loss A/c	35,000	By Balance b/d	40,000
To Profit and Loss Suspense A/c	8,750	By General Reserve A/c	35,000
To B's Executor's A/c	76,250	By C's Capital A/c (Goodwill)	27,000
		By D's Capital A/c (Goodwill)	18,000
	1,20,000		1,20,000

Retirement/Death of a Partner Exercise 6.100

Solution Ex. 79

Journal
Particulars		L.F.	Debit Rs.	Credit Rs.
Workmen's Compensation Reserve	Dr.		6,000
------To X's Capital A/c				3,000
------To Y's Capital A/c				2,000
------To Z's Capital A/c				1,000
(Being Workmen's Compensation Reserve distributed among partners in their old ratio)

General Reserve A/c	Dr.		6,000
------To X's Capital A/c				3,000
------To Y's Capital A/c				2,000
------To Z's Capital A/c				1,000
(Being general Reserve distributed among partners in their old ratio)

X's Capital A/c	Dr.		3,000
Y's Capital A/c	Dr.		2,000
Z's Capital A/c	Dr.		1,000
------To Advertisement Suspense A/c				6,000
(Being advertisement Suspense Written off among partners in their old ratio)

X's Capital A/c	Dr.		4,500
Y's Capital A/c	Dr.		3,000
------To Z's Capital A/c				7,500
(Being Z's Share of goodwill adjusted)

Revaluation A/c	Dr.		3,600
------To Sundry debtors A/c				1,000
------To Furniture A/c				500
------To Plant and Machinery A/c				1,500
------To Bills Receivable A/c				600
(Being decrease in value of Assets transferred to Revaluation Account)

Stock A/c	Dr.		1,000
Building A/c	Dr.		5,000
------To Revaluation A/c				6,000
(Being increase in value of Assets transferred to Revaluation Account)

Revaluation A/c	Dr.		2,400
------To X's Capital A/c				1,200
------To Y's Capital A/c				800
------To Z's Capital A/c				400
(Being revaluation profit distributed among partners in their old ratio)

Profit and Loss Suspense A/c	Dr.		1,333
------To Z's Capital A/c				1,333
(Being Z's share of profit transferred his capital account)

Z's Capital A/c	Dr.		22,233
------To Z's Executor's A/c				22,233
(Being amount due to Z transferred to his Executor's Account)

Z's Executor's A/c	Dr.		12,333
------To Bank A/c				12,333
(Being amount paid to Z's Executor)

Z's Executor's Account
Dr.					Cr.
Date	Particulars	Rs.	Date	Particulars	Rs.
2014			2014
31 July	To Bank A/c	12,233	31 July	By Z's Capital A/c	22,233
2015			2015
31 Mar	To Balance c/d	10,667	31 Mar	By Interest A/c (10,000 ×10% for 8months)	667
		22,900			22,900
2015			2015
31 July	To Bank A/c (5,000+667+333)	6,000	1 Apr	By Balance b/d	10,667
			31 July	By Interest A/c (10,000 ×10% for 4 months)	333

2016			2016
31 Mar	To Balance c/d	5,333	31 Mar	By Interest A/c (5,000 ×10% for 8 months)	333
		11,333			11,333
2016			2016
31 July	To Bank A/c (5,000+333+167)	5,500	1 Apr	By Balance b/d	5,333
			31 July	By Interest A/c (5,000 ×10% for 4 months)	167
		5,500			5,500

Working Notes

1.

Calculation of Goodwill

Goodwill = Average Profit ×Number of Year's Purchase

Goodwill = Average Profit × No. of Years Purchase

=15,000 × 3 = Rs.45,000

2.

Adjustment of Goodwill

X : Y: Z= 3 : 2 : 1 (Old Ratio)

Z's died.

Gaining Ratio (X and Y)= 3 : 2

Z's share of goodwill is to be distributed between X and Y in their = 3 : 2 (Gaining Ratio)

3.

Calculation Z's Share of Profit

Profit for Past Year = Rs.24,000

4.

Revaluation Account
Dr.					Cr.
Particulars			Rs.	Particulars	Rs.
To Sundry Debtors A/c			1,000	By Stock A/c	1,000
To Furniture A/c			500	By Building A/c	5,000
To Plant and Machinery A/c			1,500
To Bills Receivable A/c			600
To Profit transferred to:
	X's Capital A/c	1,200
	Y's Capital A/c	800
	Z's Capital A/c	400	2,400
			6,000		6,000

Solution Ex. 80

Revaluation Account
Dr.		Cr.
Particulars	Rs.	Particulars	Rs.
To Machinery A/c	1,50,000	By Building A/c	2,00,000
To Furniture A/c	46,000
To Provision for D. Debts A/c	4,000

	2,00,000		2,00,000

X's Capital Account
Dr.		Cr.
Particulars	Rs.	Particulars	Rs.
To Advertisement Suspense A/c	50,000	By Balance b/d	3,00,000
To X's Executors A/c	5,05,000	By General Reserve A/c	15,000
		By Y's Capital A/c	1,12,500
		By Z's Capital A/c	75,000
		By Profit and Loss Suspense A/c	37,500
		By Interest on Capital A/c	15,000

	5,55,000		5,55,000

X's Executors Account
Dr.		Cr.
Particulars	Rs.	Particulars	Rs.
To Bank A/c	2,52,500	By X's Capital A/c	5,05,000
To X's Executors Loan A/c	2,52,500

	5,05,000		5,05,000

Working Notes:

1.

Calculation of Share in General Reserve

2.

Calculation of Interest on Capital

3.

Calculation of Profit and Loss Suspense

4.

Calculation of Share in Goodwill

Gaining Ratio = New Ratio - Old Ratio

Goodwill = Average profit × No. of Years' Purchase

= 1,80,000 × 2.5 = Rs.4,50,000

X's share of goodwill is to be distributed between Y and Z in their = 3 : 2 (Gaining Ratio)

Retirement/Death of a Partner Exercise 6.101

Solution Ex. 81

Revaluation Account
Dr.		Cr.
Particulars	Rs.	Particulars		Rs.
To Machinery A/c	24,000	By Furniture A/c		7,500
To Provision for D. Debts A/c	2,500	By Stock A/c		6,400
		By Prepaid Advertisement Exp. A/c		4,200
		By Loss transferred to:
		X's Capital A/c	4,200
		Y's Capital A/c	2,800
		Z's Capital A/c	1,400	8,400

	26,500			26,500

Partners' Capital Accounts
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Current A/c			10,000	By Balance b/d	2,40,000	1,60,000	80,000
To Revaluation A/c	4,200	2,800	1,400	By Current A/c	16,000	5,000
To Z's Capital A/c		10,000		By Reserve A/c	30,000	20,000	10,000
To Z's Capital A/c		34,000		By Y's Capital A/c			34,000
To Z's Executors A/c			1,22,600	By Y's Capital A/c			10,000
To Balance c/d	2,81,800	1,38,200

	2,86,000	1,85,000	1,34,000		2,86,000	1,85,000	1,34,000

Z's Executor Accounts
Dr.							Cr.
Date	Particulars	J.F.	Rs.	Date	Particulars	J.F.	Rs.
2017-18				2017-18
31 Dec	To Bank A/c (61,300+6,130)		67,430	30 Jun	By Z's Capital A/c		1,22,600
31 Mar	To Balance c/d		62,832.5	31 Dec	By Interest A/c		6,130
				31 Mar	By Interest A/c		1,532.5

			1,30,262.5				1,30,262.5

2017-18				2017-18
30 Jun	To Bank (61,300+3,065)		64,365	1 April	By Balance b/d		62,832.5
				30 Jun	By Interest A/c		1,532.5

			64,365				64,365

Working Notes:

1.

Calculation of Profit and Loss Suspense

2.

Calculation of Gaining Ratio and Share of Goodwill

Gaining Ratio = New Ratio - Old Ratio

Gaining Ratio Only Y' =

Z's share of goodwill =

Z's share of goodwill is to be distributed only Y Gaining Ratio

Retirement/Death of a Partner Exercise 6.102

Solution Ex. 82

Revaluation Account
Dr.			Cr.
Particulars		Rs.	Particulars	Rs.
To Machinery A/c		13,600	By Creditors A/c	1,000
To Profit transferred to:			By Stock A/c	14,000
X 's A/c	5,000		By Provision for Doubtful Debts A/c	4,000
Y's A/c	3,000		By Investment A/c	2,200
Z's A/c	2,000	10,000	By Bad Debts Recovered A/c	200
			By Prepaid Insurance A/c	2,200

		23,600		23,600

Partners' Capital Accounts
Dr.							Cr.
Particulars	X	Y	Z	Particulars	X	Y	Z
To Goodwill A/c	6,000	3,600	2,400	By Balance b/d	1,35,000	95,000	74,000
To Drawing A/c			12,000	By Revaluation A/c	5,000	3,000	2,000
To Profit and Loss A/c	75,000	45,000	30,000	By IFR A/c	3,500	2,100	1,400
To X's Capital A/c		8,750		By Y's Capital A/c	8,750		14,000
To Z's Capital A/c		14,000		By WCR A/c	3,000	1,800	1,200
To Z's Loan A/c			1,000
To Z's Executors A/c			47,200
To Balance c/d	74,250	30,550
	1,55,250	1,01,900	92,600		1,55,250	1,01,900	92,600

Z's Executors Account
Dr.		Cr.
Particulars	Rs.	Particulars	Rs.
To Bank A/c	11,200	By Z's Capital A/c	47,200
To Z's Executors Loan A/c	36,000

	47,200		47,200

Balance sheet as on 1^ST April 2018 (after Z's death)
Liabilities		Rs.	Assets	Rs.
Creditors		17,000	Patents	52,000
Z's Executors Loan		36,000	Machinery	48,800
Workmen Compensation Claim		1,000	Stock	34,000
Capital			Debtors	24,000
X	74,250		Prepaid Insurance	2,200
Y	30,550	1,04,800
Bank Overdraft (600+8,200-11,200+200)		2,200


		1,61,000		1,61,000

Working Notes:

1.

Calculation of Gaining Ratio and Share of Goodwill

Gaining Ratio = New Ratio - Old Ratio

2.

Calculation of Goodwill

Goodwill = Average Profit × Number of years Purchase

= 28,000 × 2.5 = Rs. 70,000

Solution Ex. 83

Y's Capital Account
Dr.				Cr.
Particulars	Rs.	Particulars	Rs.
Advance to Y	7,00,000	Balance b/d	7,00,000
Profit and Loss A/c	1,28,000	General Reserve	24,000
Profit and Loss Suspense A/c	32,000	X's Capital A/c	64,000
		Z's Capital A/c	32,000
		Balance c/d (Amount due from Y)	40,000

	8,60,000		8,60,000

Working Notes:

WN1: Calculation of Y's Share of Profit/Loss

WN2: Calculation of Y's Share of Goodwill

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Class 12-commerce T S GREWAL Solutions Accountancy Chapter 6: Retirement/Death of a Partner

Retirement/Death of a Partner Exercise 6.77

Solution Ex. 1

Solution Ex. 2

Solution Ex. 3

Solution Ex. 4

Solution Ex. 5

Solution Ex. 6

Retirement/Death of a Partner Exercise 6.78

Solution Ex. 7

Solution Ex. 8

Solution Ex. 9

Solution Ex. 10

Solution Ex. 11

Solution Ex. 12

Solution Ex. 13

Solution Ex. 14

Solution Ex. 15

Solution Ex. 16

Retirement/Death of a Partner Exercise 6.79

Solution Ex. 20

Solution Ex. 17

Solution Ex. 18

Solution Ex. 19

Solution Ex. 21

Solution Ex. 22

Solution Ex. 23

Retirement/Death of a Partner Exercise 6.80

Solution Ex. 24

Solution Ex. 25

Solution Ex. 26

Solution Ex. 27

Retirement/Death of a Partner Exercise 6.81

Solution Ex. 28

Solution Ex. 29

Solution Ex. 30

Retirement/Death of a Partner Exercise 6.82

Solution Ex. 31

Solution Ex. 32

Retirement/Death of a Partner Exercise 6.83

Solution Ex. 33

Solution Ex. 34

Retirement/Death of a Partner Exercise 6.84

Solution Ex. 35

Solution Ex. 36

Retirement/Death of a Partner Exercise 6.85

Solution Ex. 37

Retirement/Death of a Partner Exercise 6.86

Solution Ex. 38

Solution Ex. 39

Retirement/Death of a Partner Exercise 6.87

Solution Ex. 40

Solution Ex. 41

Solution Ex. 42

Solution Ex. 43

Retirement/Death of a Partner Exercise 6.88

Solution Ex. 44

Solution Ex. 45

Solution Ex. 46

Retirement/Death of a Partner Exercise 6.89

Solution Ex. 47

Retirement/Death of a Partner Exercise 6.90

Solution Ex. 48

Solution Ex. 49

Solution Ex. 50

Solution Ex.51

Retirement/Death of a Partner Exercise 6.91

Solution Ex. 52

Retirement/Death of a Partner Exercise 6.92

Solution Ex. 53

Solution Ex. 54

Retirement/Death of a Partner Exercise 6.93

Solution Ex. 55

Solution Ex. 56

Solution Ex. 57

Solution Ex. 58

Solution Ex. 59

Solution Ex. 60

Solution Ex. 61